State budget compromise hinges on saving surplus cash

By Marc Levy The Associated Press

Monday

Jun 24, 2019 at 3:22 PMJun 24, 2019 at 10:25 PM

HARRISBURG, Pa. (AP) — Pennsylvania lawmakers said Monday they have struck a compromise on a spending plan that uses surplus dollars to spread around modest spending increases, hold the line on taxes and make a substantial deposit into a relatively bare budgetary reserve.

Votes in the Republican-controlled Legislature were expected later this week, as the fiscal year winds down and legislative aides scramble to prepare hundreds of pages of budget-related legislation before lawmakers leave Harrisburg for the summer.

The main budget bill for the 2019-20 fiscal year starting July 1 emerged from the House Appropriations Committee on a 27-9 vote, with every Republican in favor and Democrats split. Democrats who voted against it issued various criticisms, including its failure to include a minimum wage increase and the elimination of a Depression-era cash assistance program that temporarily provided $200 a month to people deemed unable to work.

Pennsylvania is in its strongest stretch of tax collections since the recession a decade ago, bringing a reprieve from a string of tight budget years and deficits.

"What we're facing right now with our increased revenues, we don't know if it's an anomaly or if it's a trend, and if it's an anomaly, we have to still be careful in our spending," said Rep. George Dunbar, R-Westmoreland. "Although the wish list is great and we would like to do a whole lot more, we have accomplished a great deal in this budget."

Democrats couldn't hide their disappointment with a budget deal that began with a February proposal by Democratic Gov. Tom Wolf that many viewed as too passive and unambitious.

"Our voters want us to put up a fight for progressive ideals and this is not a fight for what Democratic voters sent us to Harrisburg to try to achieve, Gov. Wolf included," said Rep. Kevin Boyle, D-Philadelphia.

The $34 billion compromise package is similar to the $34.1 billion plan Wolf floated in February. House Appropriations Committee Chairman Stan Saylor, R-York, said the package does not rely on any increases in fees or taxes.

Wolf's office said Monday that the budget package includes significant amounts he had sought for early childhood education and vocational and technical education programs, as well as benefits for military veterans and farmers.

All told, the package authorizes almost $2 billion in additional spending through the state's main operations account, or 6% more than the spending lawmakers authorized last year, counting cost overruns in the current fiscal year.

Much of the extra spending covers new discretionary aid for public schools, plus extra amounts to meet rising costs for prisons, debt, pension obligations and health care for the poor.

Public schools will receive $160 million more for general operations and instruction, a bump of almost 3%, although school advocates had pressed for more, saying districts are struggling to keep up with rising costs. Community colleges and state-subsidized universities, including Penn State and Temple, will each get another 2% in aid, an increase from what Wolf had proposed.

The Legislature will renew a $60 million school and community security grant program it began after last year's mass shooting at a high school in Parkland, Florida.

In addition, almost $300 million is slated for a deposit into the budgetary reserve, hitting on a key criticism of credit rating agencies that Pennsylvania lacks reserve cash.

Still, budget makers are using various cash maneuvers to veil the true cost of government operations, moving hundreds of millions of dollars in costs to outside accounts. Budget makers also have a recent history of low-balling spending estimates for health care services on the front end of the fiscal year, costs they must make up at the end of the fiscal year.

Lawmakers on Monday were continuing closed-door discussions to resolve a variety of budget-related disagreements.

One is Wolf's request for $15 million to help counties cover the cost of new voting machines. Republicans have protested Wolf's stated intent to decertify voting machines in use last year, while some lawmakers have asked for more cash, sooner, to help counties foot the bill.

Legislation with a package of changes to election laws was expected to be tied to cash for voting machines, but House Democrats last week protested a provision to eliminate the ballot option for voters to simply select a straight-party ticket in elections.

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